Repeatedly cancelling notice accounts

leitmotif

I'm looking into notice accounts for a better interest rate. I see that several say that you can give notice to close the account but cancel the closure (if you change your mind and want to keep the account) up to and including the day before the notice period is complete.

With that in mind, surely one can just give notice and then cancel the closure the day before the notice period expires on a rolling basis. For example, I'm looking at an account with 90 days' notice. The maximum wait would still be 90 days, of course, if I decide on the very same day of giving notice that I genuinely do want access to the money. But if, say, I give the 90 days' notice on 1 September and intend to cancel that notice on 28 November, but subsequently decide on 21 November that I genuinely do want access to the money, then I'd only have to wait a week. Crucially, I see nothing in the terms and conditions of the various notice savings accounts preventing this. All I'd be doing is giving notice four times a year via an impartial online system for which there is no administrative headache. Any thoughts?

Hoenir

Closure of notice accounts, where it is permissable, often results in a penalty. Negates any benefit from what you are suggesting. Not that it's a new idea in any event. 

leitmotif

Hoenir said:

Closure of notice accounts, where it is permissable, often results in a penalty. Negates any benefit from what you are suggesting. Not that it's a new idea in any event. 

Thanks for your response. I'm not sure what you mean. In all cases, this would not be closure prior to the notice period completing.

RobfromCornwall

Yes, you can do what you suggest.  That's the point - you can give notice and cancel that notice any time up to when the withdrawal is due to be made (check account terms for exact cut off).  

I wouldn't give notice to close, though, for ease I'd give notice to withdraw an amount.  Then the account remains open no matter that I do.

I think the poster above is confusing notice with fixed rate/fixed term accounts. 

leitmotif

RobfromCornwall said:

Yes, you can do what you suggest.  That's the point - you can give notice and cancel that notice any time up to when the withdrawal is due to be made (check account terms for exact cut off).  

I wouldn't give notice to close, though, for ease I'd give notice to withdraw an amount.  Then the account remains open no matter that I do.

I think the poster above is confusing notice with fixed rate/fixed term accounts. 

Good advice, thank you.

Kim_13

I suppose the only thing preventing this would be the institution involved deciding that this was gaming the system or whatever and deciding that they no longer wanted the OPs custom. Occasionally someone will genuinely change their mind, but constantly cycling notices might raise eyebrows.

Some accounts/providers don’t allow notice to be cancelled once given - Family BS Windfall Bond for one - if people give and then retract too many notices, it might mean more providers taking this line.

leitmotif

Kim_13 said:

I suppose the only thing preventing this would be the institution involved deciding that this was gaming the system or whatever and deciding that they no longer wanted the OPs custom. Occasionally someone will genuinely change their mind, but constantly cycling notices might raise eyebrows.

Some accounts/providers don’t allow notice to be cancelled once given - Family BS Windfall Bond for one - if people give and then retract too many notices, it might mean more providers taking this line.

True. That had occurred to me, but in each case the terms and conditions say they will only close your account in the event of serious breaches of their terms and conditions, which contain nothing about cancelling withdrawals. So they could argue that I'm gaming the system, i.e. not operating within the spirit of the rules even if I'm adhering to the letter of the rules, but is that a serious breach? Also, for 90-day notice periods, I won't be making too many withdrawal requests before switching, as I can imagine that they'll change their interest rate before long and I'll be looking for another provider.

slinger2

Over the winter I had a lot of money in the RCI 95-day account. I was in the habit of making roughly monthly withdrawal requests and then cancelling most of them a few days before the due date. Designed to guarantee that I could get some money from the account within a month or so. Didn't get any complaints from RCI about it. Of course, I could have waited for the money to go out and then put it back in, but RCI conveniently provide a button to cancel the request.

Investec also provide a button to cancel requests from their 90-day account, although I've not used that so far.

Reaper

Many, many years ago I worked in a Building Society and this was a common thing people did. We sometimes even suggested it to our customers so I don't think there is any chance of them closing your account for gaming the system.

wmb194

leitmotif said:

I'm looking into notice accounts for a better interest rate. I see that several say that you can give notice to close the account but cancel the closure (if you change your mind and want to keep the account) up to and including the day before the notice period is complete.

With that in mind, surely one can just give notice and then cancel the closure the day before the notice period expires on a rolling basis. For example, I'm looking at an account with 90 days' notice. The maximum wait would still be 90 days, of course, if I decide on the very same day of giving notice that I genuinely do want access to the money. But if, say, I give the 90 days' notice on 1 September and intend to cancel that notice on 28 November, but subsequently decide on 21 November that I genuinely do want access to the money, then I'd only have to wait a week. Crucially, I see nothing in the terms and conditions of the various notice savings accounts preventing this. All I'd be doing is giving notice four times a year via an impartial online system for which there is no administrative headache. Any thoughts?

Yep, you can do this. It’s rare that I have notice accounts but I have done this. Back in the days when notice accounts were last popular - think ‘90s - this was a tactic that was often mentioned in the personal finance pages.

 I’ve been doing something similar with c.30 day* UK Treasury bills via Freetrade. You can quickly and easily set the proportion you’d like to reinvest for each tranche of bills you own via its app right up to the weekly Thursday night cutoff. 

https://freetrade.io/treasury

*Technically 28 days but you need to allow a day or two for settlement to your account.

allegro120

Kim_13 said:

I suppose the only thing preventing this would be the institution involved deciding that this was gaming the system or whatever and deciding that they no longer wanted the OPs custom. Occasionally someone will genuinely change their mind, but constantly cycling notices might raise eyebrows.

I did this with most notice accounts I had and never had any problem.  I schedule weekly withdrawals and cancel them at a cut off date, most notices can be cancelled a day before the notice is due.  This of course depends on T&C of a particular account.